Opponents of Sinclair Broadcast Group’s proposed $3.9 billion takeover of Tribune Media Co. have stepped up opposition to the deal following media reports that federal regulators may fine the Hunt Valley-based Sinclair $13.3 million for airing programming not clearly labeled as advertisements.
Bloomberg News, citing a person briefed on the matter, reported that the Federal Communications Commission voted to issue the fine.
Bloomberg said the FCC found programming for Huntsman Cancer Foundation, which raises money for the Huntsman Cancer Institute, ran more than 1,700 times on 64 Sinclair stations and 13 other stations last year. Viewers were not told that the programming — which included promotions for the foundation — were paid advertisements, the Bloomberg story said.
The Huntsman foundation raises funds to support treatment, education and research being conducted at the cancer institute at the University of Utah.
The potential fine was first reported by Reuters — but has not been announced by the FCC.
An FCC spokeswoman did not respond to a request for comment Friday and could not be reached Saturday. Sinclair officials declined to comment on the reports.
Sinclair, based in Hunt Valley, raised the possibility of being hit with a fine in its third quarter earnings report filed Nov. 8 with the Securities and Exchange Commission.
“The FCC has undertaken an investigation in response to a complaint it received alleging possible violations of the FCC’s sponsorship identification rules by the company and certain of its subsidiaries,” the filing said. “We cannot predict the outcome of any potential FCC action related to this matter, but it is possible that such action could include fines and/or compliance programs.”
The Coalition to Save Local Media and Allied Progress, both opponents of the merger, said the issue raises questions about whether the broadcaster will act in the public interest if the deal goes through.
The Coalition said in a statement Friday that Sinclair must prove to the FCC that the merger will benefit consumers. The coalition bills itself as nonpartisan, with members that have previously been on opposite sides of regulatory battles, including the American Cable Association, Common Cause, the Competitive Carriers Association, DISH, Latino Victory Project, One America News Network, Parents Television Council and RIDE TV.
The coalition statement said the Huntsman issue “should prompt more scrutiny by the FCC, Justice Department and other parties on this proposed mega-merger. This merger should be denied.”
Consumer watchdog group Allied Progress also called for the FCC to stop the Sinclair-Tribune merger. The group has previously criticized Sinclair requiring local news to carry pro-Trump content in “must run” segments on its stations.
“This isn’t the first time Sinclair has been caught playing fast and loose with the FCC rules, nor has it been the first time the FCC under Chairman Ajit Pai has treated the broadcast news giant with kid gloves,” Karl Frisch, executive director of Allied Progress, said in the statement.
Sinclair, already the nation’s largest broadcaster, has faced opposition to its controversial proposal to buy Tribune’s 42 stations in 33 markets. The merger would give Sinclair ownership or control of 233 television stations in 108 markets and the ability to reach 72 percent of the nation’s TV households.
Sinclair needs approval of the FCC and the Department of Justice, both of which are reviewing the proposal.
Tribune Media was formed in 2014 when Tribune Co. — then the parent of The Baltimore Sun — split its broadcasting and publishing divisions into separate companies. The broadcast division became Tribune Media while the publishing division, including The Sun, became Tribune Publishing, renamed tronc Inc. last year.
Approval of the Sinclair-Tribune Media deal appears likely because the FCC, under Pai, an appointee of President Donald Trump, has been relaxing rules for broadcast ownership and has looked favorably on deregulation.
Sinclair has said the scale and efficiencies that will come from the merger will ensure the future of free over-the-air-televison.